People condemn targeted advertising for its "creepiness" but the real issue is that we are giving private companies more power.
Jonathan Zittrain noted last summer, "If what you are getting online is for free, you are not the customer, you are the product." This is just a fact: The Internet of free platforms, free services and free content is wholly subsidized by targeted advertising, the efficacy (and thus profitability) of which relies on collecting and mining user data. We experience this commodification of our attention everyday in virtually everything we do online, whether it's searching, checking email, using Facebook or reading The Atlantic Technology section on this site. That is to say, right now you are a product.
Most of us, myself included, have not come to terms with what it means to "be the product." In searching for a framework to make sense of this new dynamic, often we rely on well established pre-digital notions of privacy. The privacy discourse frames the issue in an ego-centric manner, as a bargain between consumers and companies: the company will know x, y and z about me and in exchange I get free email, good recommendations, and a plethora of convenient services. But the bargain that we are making is a collective one, and the costs will be felt at a societal scale. When we think in terms of power, it is clear we are getting a raw deal: we grant private entities -- with no interest in the public good and no public accountability -- greater powers of persuasion than anyone has ever had before and in exchange we get free email.
The privacy discourse is propelled by the "creepy" feeling of being under the gaze of an omniscient observer that one gets when they see targeted ads based on their data about their behavior. Charles Duhigg recently highlighted a prime example of this data-driven creepiness when he revealed that Target is able to mine purchasing behavior data to determine if a woman is pregnant, sometimes before she has even told her family. Fundamentally, people are uncomfortable with the feeling that entities know things about them that they didn't tell them, or at least that they didn't know they told them.
For many people the data-for-free-stuff deal is a bargain worth making. Proponents of this hyper-targeted world tell us to "learn to love" the targeting, after all we are merely being provided with ads for "stuff you would probably like to buy." Oh, I was just thinking I needed a new widget, and here is a link to a store that sells widgets! It's great, right? The problem is that, in aggregate, this knowledge is powerful and we are granting those who gather our data far more than we realize. These data-vores are doing more than trying to ensure that everyone looking for a widget buys it from them. No, they want to increase demand. Of course, increasing demand has always been one of the goals of advertising, but now they have even more power to do it.
Privacy critics worry about what Facebook, Google or Amazon knows about them, whether they will share that information or leak it, and maybe whether the government can get that information without a court order. While these concerns are legitimate, I think they are missing the broader point. Rather than caring about what they know about me, we should care about what they know about us. Detailed knowledge of individuals and their behavior coupled with the aggregate data on human behavior now available at unprecedented scale grants incredible power. Knowing about all of us - how we behave, how our behavior has changed over time, under what conditions our behavior is subject to change, and what factors are likely to impact our decision-making under various conditions - provides a roadmap for designing persuasive technologies. For the most part, the ethical implications of widespread deployment of persuasive technologies remains unexamined.
Using all of the trace data we leave in our digital wakes to target ads is known as "behavioral advertising." This is what target was doing to identify pregnant women, and what Amazon does with every user and every purchase. But behavioral advertisers do more than just use your past behavior to guess what you want. Their goal is actually to alter user behavior. Companies use extensive knowledge gleaned from innumerable micro-experiments and massive user behavior data over time to design their systems to elicit the monetizable behavior that their business models demand. At levels as granular as Google testing click-through rates on 41 different shades of blue, data-driven companies have learned how to channel your attention, initiate behavior, and keep you coming back.